TRANSITION STRATEGIES IN ENACTING FUNDAMENTAL TAX REFORM

Autor:	Christian Keuschnigg, Mirela Keuschnigg
Rok vydání:	2012
Předmět:	Macroeconomics Economics and Econometrics Double taxation Direct tax ComputingMilieux_LEGALASPECTSOFCOMPUTING Tax reform ComputingMilieux_GENERAL Value-added tax Tax credit Ad valorem tax Accounting State income tax Economics Finance Indirect tax
Zdroj:	National Tax Journal. 65:357-385
ISSN:	1944-7477 0028-0283
DOI:	10.17310/ntj.2012.2.04
Popis:	This paper discusses transition strategies that might be used in moving from an income tax to consumption based business taxes in the form of an R-base cash-fl ow tax, an R+F-base tax, or an ACE (allowance for corporate equity) tax. While these three taxes have attractive neutrality properties, moving from the status quo to a new system often involves a diffi cult trade-off between short-run losses and longrun gains. We consider two alternative ways of spreading the gains and costs of reform more evenly across generations. Defi cit fi nancing of the large revenue loss that occurs immediately after reform allows the smoothing of wage tax rates over time and the elimination or reduction of short-run income losses. Alternatively, a system of delayed deductions requires fi rms to carry forward with interest some of the large deductions that are newly available after the enactment of a major tax reform. In shifting tax revenue from the future to the present, such policies are politically appealing, as they trade somewhat reduced future income gains for improved economic performance immediately after reform.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_dedup___::be188ee2ee03ebabc488b6e52d98e64f https://doi.org/10.17310/ntj.2012.2.04 Zobrazit plný text záznamu Plný text ve formátu PDF